Theyre flat in the uk. Weve taken that apple money and applied it immediately to the stock. They are. Theyre also still buying bonds up like crazy over there. Put the money theres so many weird things going on theyre actually hoping to fund the transaction by which denon is buying bonds. Any way, lets get to bonds, you answered, 158, crude down today and you can see brent nearing at least 50 a share. Weve got the latest s p 500 case chiller report, showing home prices rose 5. 9 . And thats why unemployment are strong, and paychecks, doing consistently strong business. We keep running into these numbers that are somewhat positive. Well get to conversations about the broader market. Want to get to the roadmap, as well and it starts with apple, which is the market also. The european ordering the company to pay over 14 billion in back taxes. Plus, any hopes of a deal off. And a bid for hersheys, saying there is no actionable way forward. Ill give you the details on what exactly went down there, and a new face of united, the Company Placing a top exec from american airlines. He left one and went to the other. Very smart guy. Very technological. Lets start with apple. Any trust regulators have ordered up to 14. 5 billion plus interest because the eu ruling effectively say that apple benefits from things in ireland that are illegal. Illegal, jim. Its interesting. This morning like a lot of people have been running to do a lot of reading on this, trying to talk to some people who might understand exactly whats at stake, and i i got back to may 21st of 2013. Do you remember when levin appeared and mccain was the subchair of this investigations committee, where they were looking at taxes paid by u. S. Corporations and loopholes and they went into in great detail, ireland in particular in all the different ways that they claimed apple was avoiding paying taxes. Apple has quietly negotiated from the government. This is a statement, an income tax rate less than 2 under the statutory rate of 12 , as well as other European Countries this was written back then and they also went into great detail how apple paid less than that because they really were actually not a taxpayer anywhere. They they had for tax purposes existed nowhere and they talked about these ghost companies. They do. And they apple came back and said were the largest u. S. Taxpayer, which is true. Which is responsive. They are by far the most proitable company in the history of the world. Theres always been this question about all the things that they you know all the intellectual Property Rights theyve sent to ireland from where they do so much of their business overseas. They made a deal. Irish money took it away and the fact is, it is a deal and if ireland is a sovereign state, you made a deal. Were you supposed to check in with the eu . Arguab arguably, if i were the eu, i would say every single deal has to be run through us. But to do retroactive is a little bit difficult. We often criticize our government when they do something retroactive. To be consistent is this going to be a strong man . If youre intel, what are you worried about . If you had a special deal with ireland, you probably ought to be worried. Right. Doesnt appear to be having that large an impact in the market. Of course apple is going to vigorously contest this, could take years one would assume. And people close to apple had been saying this would be the number. Now yesterday there was some tony numb phony number. No one endorsed that number. The fact is were all stuck with the notion of sovereignty. Weve been conditioned since brexit that eu basically is trying to become a nation. Right. And in that sense, you can have a separate nation within a nation, but ireland would argue that its got the right to be able to negotiate these things. Without having to go to the eu. Surely Going Forward theyve got to go to the eu. My problem is, how can they be rerow active . T the eus side, is they have every right to have taxes, they can do anything they want. Of course. King george iii. And apples going to be the the most Profitable Company the world has ever seen and i go back to may of 2013 where it was a great focus in terms of tax avoidance, all legal, but something that came up. Tax avoidance is legal. Tax evasion no. Lets get a look at whats going on, and go live to julia in brussels. Good morning. Reporter good morning, i think guys i want to respond to what you were saying there. I think the European Commission would argue here thats 14. 5 billion irish taxpayers own and do benefit in the country but the Irish Government doesnt want the money. They want to protect the relationship of apple and others in the country. They said they believe this ruling is going to be overturned and less about how much Corporation Tax they pay, less than 1 as you quite rightly pointed out. Theyre saying this is more about the country, the government thats doing the collecting, in this case, ireland. When i spoke to the Competition Commissioner this morning, she said exactly that. It was all about ireland and their tax practices. Listen in. This is a company who makes a lot of profits by selling wonderful products to european customers and apple have set up in ways that they themselves are completely of course in their good right to do, but ireland is not in their good right to give them tax benefit, which are selective only to this company. So some context on apple, 14. 5 billion is dwarfed by the estimated 215 billion theyve got sitting in cash piles overseas. The adverse scenario, the worstcase scenario put forth by j. P. Morgan was 19 billion and even in that case, it would be immaterial to apples share price. There are bigger questions, what does this mean for the current setup of apple and the tax arrangements for ireland, and how will the u. S. Treasury respond and what does this mean for investigations into mcdonalds and amazon. They could also see pretty big fines. Julia chatterley, thank you very much. Taking me back to 2013, take a look at all of the statements from mccain and levin and apple back in 2013 when apple was the focus here. And i would argue many things uncovered by levin, seemed to be the things the, u is going after in terms of this case. Doesnt it argue for the need for comprehensive Corporate Tax reform . There are so many things that are dysfunctional. And when it comes to Corporate Taxes, i could argue there could only be tax at one level. If we simplified it so much wouldnt it be nice if they didnt feel the need to come up with all of these different ways to have their foreign sales havened in one place where they were getting extra ordinarily low rate, but brought the profits back . Yes, and thats what we want che. I studied Corporate Tax. Its been a long time. The idea about Corporate Tax is its owned by shareholders so you get the dividends and the corporation pays the taxes and the company and then you pay. Thats not right. The idea whereof its domiciled seems to be kind of fanciful. All of this seems kind of made up and thats because we dont have a tax policy. Right. And finally, on the stock itself okay, thank you. And on overhang for the stock, is this a oneday story and we kind of forget about because its going to go on for years . Yes. Were going to talk about the iphone 7, and people are going to say what about that ruling, and youll say, thats under appeal, and irish of fighting it and thats about the eu and you know how screwed up the eu is. Thats kind of like where were going to be. We can just fastforward the tape. I didnt get an apple invitation by the way, for the launch, and im not hurt. Youre not hurt . Me thinks maybe thats not true. Maybe you are a little. I was a little hurt. I think that invitations forthcoming right away. I was very hurt. I was hoping you wouldnt bring it up. Lets get to the other story quickly and well deal with mond mondelese and hershey. And jumping from one legacy carrier to another and well look at futures and again, were going to have a lot more on mondelese walking away from hershey. Weve got to talk about that. Lets talk about that. Forget the airline executives. Were back after this. What if a company that didnt make cars made plastics that make them lighter . The lubricants that improved fuel economy. Even technology to make engines more efficient. What company does all this . Exxonmobil, thats who. Were working on all these things to make cars better and use less fuel. Helping you save money and reduce emissions. And you thought we just made the gas. Energy lives here. Theres no deal between mondelez and hershey in a statement late yesterday, mondelez says, following additional discussions and by the way, those sdediscussions w between the ceo of monday lease, and irene rosenfeld. After the release, im taking taking into account recent shareholder developments, we determined there is no actionable path forward towards an agreement. You can see hershey shares are going to be down over 10 and mondelez is going to be up about 3 . Jim this was always a tough one from the start. Because of the trust, the presence of the Hershey Trust which controls hershey, 80 of the vote, 34 of the economics. But as i reported in that first day, there had been months of back and forth between rosenfeld. I always had the question as to well, when it was rejected, so forcefully that 107 bid that was made initially by monday leelem they never get around in discussioni discussing the perceptions bilbry had, versus what mondelez was having to pay . You can tell you people familiar with the situation that ro rosenfeld said we may go to 115, but she was told 125 has to be the starting point for negotiations. Theres no level of earnings power can justify this to 28, 29. I cannot justify that. Not to mention the earnings from the kitkat license revert to nestly, thats 10 of ebitda. Thats something that monday lea mondelez has been making cite f of. Im hearing the trust has added a lot more members, was impossible to negotiate with. People saying to me, there was simply nobility to figure out the problems at hand. You have the company on the one side, but then you have the trust and what was simply an in bil ability to make decisions about the economic level they see at hershey, sell their steake at some number. Hershey is well run, but i guess the trust account get in the way of the management. The amendment is pretty good at hi hershey. Theyve done a good job. I guess the disfunction is at that trust level. It doesnt affect the actual team that run hershey, which used to be not good at all because people felt they couldnt get taken over, so they did what they wanted. It was a pennsylvania constitutio instituti institution, and they moved operations overseas, and became a lot more economic. Its a wellrun company, which is why i couldnt see the higher bid. Its not a bad company they can do more. No, although there had been on the hope on the part of mondelez, you create this global confection company, they had cadbury already. Its interesting from the trust perspective, and by the way, if you havent kept up with it, a number of members have left, because of the attorney general shes out. Shes out because she got convicted. But that trust will recompose itself late this year, early next year, but at some point, one would think given almost all of the assets they owner in hershey stock, maybe they want to diversify from a domestic chocolate maker. You could make an argument they could benefit and be acting responsibly as trustees, diversifying and that doesnt seem to be something that is in the offering, and mondelez, this is not some sort of thing were going to wait in the wings until the trust is reconstituted. Theyre done. Okay if theyre done, like santa fe theyve already they have bankers. They obviously didnt like their current they werent satisfied they were not satisfied with the current lineup, so what does she do . Thats a great question. Food stocks roll red hot, even though the Consumer FoodPackage Group theyre going to continue to be opportunistic, and youre going to start hearing these Kraft Kraft Heinz deal trying to put monday disea mondelez back together. I dont think theyre ready. Kielloggs. And did you know hedge funds now attract ip addresses and who is communicating with whom. Apparently its legal. Ships from saudi arabia, how much oil there is. They talk about virtually anything. All of it may add up to absolutely nothing. Im going to stay close to this. Theyre trying to justify the hedge funds and theyre doing all sorts of stuff. And who are the big guns at mondelez . But in this case, they had a view, jim, there was an opportunity to do something at an appropriate structure, and price, and they were wrong. Well, its like the pennsylvania has a long history of these trusts the barns foundation, the gerald school, it just seems like pennsylvanias got a series of people that try to shell their assets to make sure they cant do anything because of the trust agreement and the trust agreement seems to be pro fund. Trust in hershey is everything and doesnt appear that is not that is going to ever not be an independent company. Right. Well, i ill tell you want i thought this one eye thought they were going to come up. I really did. I thought there was going to be a diesel. Did you . I thought hershey would take the money and run, be able to fund the school forever. Kind of made sense. Unlike the bank crofts, when it came to dow jones, and murdock. Obviously the stock was reflecting this idea a deal could be done. Yep. No. No, no all right. But yes to cramers mad dash with the count down of the opening bell. Future this is morning, were about ten minutes away from the open. Were squawk on the street right after this. Were drownin. Where, in all of this, is the stuff that matters . The stakes are so high, your finances, your future. How do you solve this . You dont. You partner with a firm that advises governments and the fortune 500, and, can deliver insight person to person, on what matters to you. Morgan stanley. Hey, jesse. Who are you . Im vern, the orange money retirement rabbit from voya. Orange money represents the money you put away for retirement. Over time, your money could multiply. Hello, all of you. Get organized at voya. Com. This is my new alert system for whenever anything happens in the market. But thinkorswim already lets you create custom alerts for all the things that are important to you. I guess we dont need the kid anymore. Custom alerts on thinkorswim. Only at td ameritrade. Hey, its been crazy with school being back so were constantly going over our data limit. Oh, well, now all of our new plans come with no data overages. Wow, no more overages . So that means. Go on. Say it. Well finally be in control. And were back. Introducing new at t plans with no data overage charges. Weve got about seven minutes before the opening bell. Lets get to the mad dash. We didnt get to that executive departure for american, so lets get to it now. American people had two great people, doug barber, doing a good job, not the stocks reflect anything at all, and scott kirby, who felt maybe he would be the ceo. They said doug doesnt fit in, he grabs the number two job at united airlines. Oscar mununos, has been there for one year, from csx, and he had a heart transplant, good luck to him because thats tough obviously, and theres been things that have been working there. Ontime baggage, best in the industry, ontime performance. But people perceive kirby as giving him a big bench. This has been the lagered. The group is so far behind, were about to get the passenger numbers the world travels bad, david because of terrorism. So i think that if you get excited about this and then you get slapped in the face with some bad numbers you wont be too excited. The transports the rails have bad numbers and theyre going up. This is not a reason i think to be as excited. United continental was doing better. They were doing better in the last year so dont feel like wow, finally theyve got a guy who is a magician. The numbers have been better. Hes a relatively young guy. They paid him 13 million on the way out of a american. Its not clear they needed to, but they did, and the next day takes a new job. Is the eu happy with that . Maybe theyre they do a lot of business. May show mad moneymad mone on in europe. Theyre going to be looking after you. Youre potentially going to be a homeowner somewhere in europe. We wont say where. Wait until when we come back, well talk about it on air, but right now well just keep it between us. Right. Luxemborg, where is that . Stop it. A lot more for us on squawk on the street. Abercrombie no eu and they they screwed up. Well look at that and a lot more right after this. Ly a hug. This toy is a reminder that someone cares. These are a chance to be part of a team. And this is the chance to succeed. Female announcer with your support, everyone at sleep train proudly dedicates their time, hearts, and resources to giving local foster children one important thing hope. Hope. Hope. Not everyone can be a foster parent. But anyone can help a foster child. Sleep train your ticket to a better nights sleep youre watching cnbcs squawk on the street. Were live from the Financial Capital of the world where the opening bell is going to be ringing in about a minute and a half. Theres a lot of corporate news. Well find some walmart news around the bell, too just from the sales of the walmart family trust. Its interesting. Not marketmoving necessarily, but what in your opinion yesterday, it was the banks right. The key to this market, this broad question i like to ask you at this time, what brok and citi, the old avago, but david get this, they say zilence will be bought. 10 , is it broad com . Now david when i see that, we talk about takeover activity in the semiconductors. David how often do you see citi initiates . Sure. Every so often, analysts try and getting some going. It is. Youve been talking consistently just in general about consolidation among broadly speaking, the chip makers. This is the beginning of the common parlance. Its like citi what i regard this is its so obvious that theres consolidation. Lets put ail name out there sky works got a new cfo. Maybe theyre going to sell. Its a little nut. He mondelez should buy. Chocolate chips, which are the best kind. People dont know were being facetious. And disneys not going to buy mar marvel because they own marvell. And the tactical rotation, omnicell, celebrating its 15th year of trading over at the nasdaq. There they are clapping away. You can see the hq exchange on the board. Let me say if the eu is after apple. Yes. When they see monsanto talking with the buyers dont they say is that when youre going to get where they say, listen, you didnt check with us, thats not going to hap